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Longtime City Hall Donor Agrees to Plead Guilty To Bribing County Official in Exchange For A $45 Million Contract

4:23 PM PDT on April 28, 2022

    FBI Seal

    Arman Gabaee, a Beverly Hills-based real estate developer and longtime city hall donor accused of attempting to purchase a million dollar home for a Los Angeles County official, in exchange for help securing a $45 million contract with the county, agreed to plead guilty to one count of bribery.

    According to the plea agreement, Gabaee provided monthly kickbacks of $1,000 to Thomas M. Shepos, a county official working in the Los Angeles County Real Estate Division, "in exchange for county leases, preferential contract terms, non-public information and other benefits." The scheme began in 2011 and went on for approximately five years.

    In 2017, Gabaee attempted to purchase a million dollar home for Shepos as a bribe in return for help securing a county lease at the Hawthorne Mall, which Gabaee owned. The potential 10-year lease was reportedly worth more than $40 million. By then Shepos had been cooperating with the feds for about a year; recording phone conversations while collecting a cool $6,000 in bribes. Gabaee ultimately put in two offers for a home in Northern California but he rescinded his second offer when the feds came knocking.

    Gabaee’s ties to local politicians date back more than a decade. In 2019, the L.A. Times reported that Gabaee, his relatives, and his family’s companies donated more than $160,000 to campaigns, office holder accounts, and ballot measures over a 12 year period. The donations coincided with the proposal of District Square, a massive mixed-use development project in the Crenshaw area. The project was initially supported by then Councilmember Herb Wesson, who helped the developers of the project obtain tens of millions of dollars in federal grants and loans, while Gabaee and his associates supported Wesson and other city hall officials with tens of thousands of dollars in financial contributions. Subsequent construction delays however led to the city receiving seven default notices. And since then the project has been in limbo.

    Over the years, Gabaee’s money went to the campaigns of influential city leaders like Mayor Eric Garcetti, current council members Mitch O’Farrell, Gil Cedillo, and Mike Bonin, as well as former council members Jose Huizar, Mitch Englander, and Herb Wesson.

    According to prosecutors, wiretapped calls related to the Shepos investigation also revealed “additional evidence of [Gabaee’s] corrupt dealings with other public officials.” A 2020 court filing from federal prosecutors suggests that in addition to Shepos, Gabaee also bribed at least five other unnamed public officials. During a wiretapped phone conversation with one official, Gabaee admitted that he made donations because he wanted “help” with development projects.

    In March 2017, Gabaee came to the aid of a friend who needed a “tax issue resolved.” He sought the help of an unnamed public official who, according to prosecutors, could “effectuate a favorable outcome” for his friend. A year later he was arrested.

    In an intercepted call with the unnamed official, Gabaee asked for help. “We’ll help him out,” the public official reassured Gabaee. A minute later Gabaee called his friend to let him know the good news. “I took care of it for you…Please do not tell anyone. Keep it between us. Keep it to yourself.” In return for the favor, Gabaee told his friend the official would let him know what he needed from him. “I help his friend’s campaigns and things like that.” 

    “Do you help with cash if he wants?” Gabaee’s friend asked.

    “…no, don’t say such things on the phone,” Gabaee responded. “And by the way, when your job is done, don’t tell anyone that this and that has happened…tell no one. Don’t even trust your own shadow…”

    That same year, prosecutors allege Gabaee bribed a public official to secure federal funding for a project in Calexico, California. In a call with an unnamed lobbyist, the lobbyist askeds bluntly, “Well, let me ask you a question, because I think this is a very honest question though. Are you willing to pay to do that?”

    “Fuck yeah,” Gabaee responds.

    In another instance, prosecutors accuse Gabaee of giving campaign contributions in exchange for “official acts” from an unnamed public official. In one phone call, Gabaee agreed to give $10,000 to the elected official. Shortly after, Gabaee received some good news. A new government employee was going to be “taking over” the construction project at his personal residence, which he had reportedly had issues with in the past.

    In another intercepted call with the lobbyist from earlier, Gabaee told them he was going to need “help soon in Washington,” from an unnamed official. Later, Gabaee agreed to write “a check or two” to get on their “good side.”

    According to prosecutors, during the call Gabaee madkes it clear that he donates to officials with the expectation of something in return. During another call with the lobbyist, Gabaee refuses to donate to a reelection campaign because he didn’t get anything from the official in the past.

    “Fuck him,” said Gabaee, referring to the elected official. 

    On May 2, Gabaee is expected to formally plead guilty to one count of bribery. He faces a maximum sentence of 10 years in prison.

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